The US Dollar Index found resistance at 83. Breakout would indicate that the correction is over, while respect would re-test support at 80. Penetration of the descending trendline indicates that the down-trend is weakening — and support at 80 is likely to hold. The signal would be strengthened if 63-day Twiggs Momentum forms another trough above zero.

Gold is headed for another test of $1260 after breaking through resistance at $1220. Breakout above $1260 would offer a target of $1360*. Bearish divergence on 63-day Twiggs Momentum, however, continues to warn of weakness and respect of resistance would indicate another test of primary support at $1160.

The euro is testing the rising trendline; penetration would indicate that the recent rally has weakened, and reversal below $1.25 would indicate another test of primary support at $1.19. Twiggs Momentum (63-day) reversal below its rising trendline already warns of a correction; and a completed peak below zero would signal another primary decline.

The pound is testing the new support level at $1.55. Respect would confirm the advance, with a target of $1.67*. A Twiggs Momentum (63-day) recovery above the zero line strengthens the signal. Failure of support at $1.55 is unlikely, but would warn of another correction.

The dollar is consolidating in a narrow range above primary support at ¥85. Recovery above short-term resistance at ¥86.50 would indicate a rally to test ¥89. A narrow rectangle above support, however, would be a strong bear signal. A trough below zero on 63-day Twiggs Momentum would indicate another primary decline. And failure of primary support would offer a target of ¥75*.

The Aussie dollar is encountering increased resistance as it approaches $0.9350. Reversal below the rising trendline would indicate that the rally is weakening. 63-day Twiggs Momentum oscillating around the zero line indicates hesitancy. In the long term, breakout above $0.9350 would offer a target of parity, while reversal below $0.87 would test primary support at $0.81.

* Target calculation: 0.93 + ( 0.93 - 0.81 ) = 1.05

The study of history is a powerful antidote to contemporary arrogance. It is humbling to discover how many of our glib assumptions, which seem to us novel and plausible, have been tested before, not once but many times and in innumerable guises; and discovered to be, at great human cost, wholly false.